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CBOT soyabeans end higher on dry S. America outlook

CHICAGO: Soyabean futures at the Chicago Board of Trade climbed Monday, boosted by concerns that a return to drier conditions in South America could cause more problems for soyabean acreage, traders said.

Soyabeans settled unchanged to 5-1/2 cents per bushel higher, with March contracts up 1 at $5.06-1/2.

Widespread rainfall last week brought relief to dry soyabean ground in southern Brazil. But conditions turned mostly dry over the weekend and were expected to remain so most of this week.

"Soil moisture levels will be declining this week across the majority of the southern corn and bean belt," Salomon Smith Barney Inc. meteorologists said Monday in a report on Brazil. "There likely will be some stress to the beans this week in the drier pockets of southern Brazil, namely pockets in Rio Grande do Sul."

The southern part of Brazil, the world's second-leading soyabean producing nation behind the United States, has suffered from drier than normal conditions since the planting season began in October and November.

Argentina, the world's third-leading soyabean grower, was also a source of concern, with generally dry weather forecast for at least the first half of this week.

CBOT soyabeans were also supported by indications that sharp price declines last week attracted foreign buying interest. Traders on Friday said China was thought to have bought about 110,000 tonnes of soyabeans from the United States.

Commodity funds were modest net sellers in soyabean futures up to late trading, floor sources said. Traders estimated that funds sold about 600 soyabean contracts.

In the pit, ADM Investor Services bought 300 March contracts and Carr Futures sold 300 March. In spreading, Cargill Inc. bought 1,000 March and sold 1,000 May at a price differential of 9-1/4 cents, and Farmers Commodities Corp. bought 800 May and sold 800 March at 9 cents.

Soyabean futures volume during Monday's pit session was estimated by the CBOT at 38,000 contracts, compared with 54,784 Friday.-Reuters